tag:blogger.com,1999:blog-35865448640861649722018-12-17T04:15:20.192-06:00Sua Sponte - A Dallas Appellate Blog by Carrington ColemanA Dallas Appellate BlogCarrington Colemannoreply@blogger.comBlogger371125tag:blogger.com,1999:blog-3586544864086164972.post-36512261223159226312018-12-13T18:00:00.000-06:002018-12-13T18:00:13.617-06:00PRIOR MATERIAL BREACH—IT’S AN ELECTION; CHOOSE WISELY<i>Richardson Communications &amp; Consulting, Inc. v. McNeese</i><br />Dallas Court of Appeals, No. 05-17-00969-CV (December 12, 2018)<br />Justices Francis, Stoddart, and Schenck (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=cfbda3b7-9950-424e-ab88-b233f7efa1fa&amp;coa=coa05&amp;DT=Opinion&amp;MediaID=a69d353f-7d27-4c02-a6ef-b4f9d10aae29" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://3.bp.blogspot.com/-huFe9WA1-ZA/XBLf34eepJI/AAAAAAAABFc/JEJZeQl9_5UiEtMHh1ToNOhJXXT3z86OACLcBGAs/s1600/ballot.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="400" data-original-width="400" height="200" src="https://3.bp.blogspot.com/-huFe9WA1-ZA/XBLf34eepJI/AAAAAAAABFc/JEJZeQl9_5UiEtMHh1ToNOhJXXT3z86OACLcBGAs/s200/ballot.jpg" width="200" /></a></div>When McNeese sued RCC for breach of a settlement agreement, RCC defended by arguing that McNeese’s prior material breaches of the agreement excused RCC’s continued performance under that contract. But the trial court granted summary judgment to McNeese, and the Dallas Court of Appeals affirmed, rejecting RCC’s prior-material-breach defense. The appeals court acknowledged that, generally, when one party to a contract commits a material breach, the other party is excused from further performance. <i>But</i>, the Court cautioned, “[t]he non-breaching party must elect between two courses of action, either continuing performance or ceasing performance…. If the non-breaching party elects to treat the contract as continuing and insists the party in default continue performance, the previous breach constitutes no excuse for nonperformance on the part of the party not in default and the contract continues in force for the benefit of both parties.” Here, after one set of alleged breaches by McNeese, RCC both continued making payments under the contract and filed a motion for contempt against McNeese, arguing he had violated an agreed injunction entered as part of the settlement agreement. This was fatal to RCC’s prior-material-breach defense to McNeese’s claim against RCC for breach of the agreement. “By seeking a contempt order after discovering these alleged violations of the injunction, which was put in place pursuant to the Agreement, RCC treated McNeese’s obligations under the Agreement as continuing, and therefore, it could not cease its own performance thereunder,” the Court explained. Judgment for McNeese on his claim that RCC had violated the Agreement, therefore, was affirmed. Moral of the story: If someone breaches a contract to which you or your client is a party, think carefully about your “election” under the prior-material-breach rule and your own obligation to continue performance under that contract, depending on which course you elect.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-46723245321407269502018-12-13T16:35:00.000-06:002018-12-13T16:35:15.768-06:00“DEATH PENALTY” SANCTIONS UPHELD<i>Ayati-Ghaffari v. Farmers Insurance Exchange</i><br />Dallas Court of Appeals, No. 05-17-00864-CV (December 11, 2018)<br />Justices Myers, Evans, and Brown (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=76b3e657-eaac-4e59-84f7-c86e17170a53&amp;MediaID=3aa2f559-1f1e-4437-85b9-b997fb0a94e0&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://4.bp.blogspot.com/-Z_BGTB-35uY/XAB0kVJ2EBI/AAAAAAAABEM/_dOB_XOxN8EV01tZQ4YDXgGAMlXoNynTgCPcBGAYYCw/s1600/dismissed.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="177" data-original-width="232" height="152" src="https://4.bp.blogspot.com/-Z_BGTB-35uY/XAB0kVJ2EBI/AAAAAAAABEM/_dOB_XOxN8EV01tZQ4YDXgGAMlXoNynTgCPcBGAYYCw/s200/dismissed.jpg" width="200" /></a></div>Trial courts in civil cases are reluctant to impose “death penalty” sanctions (like striking a party’s pleadings) based on abuse of the discovery process, at least in part because such orders are often reversed on appeal. In this case, however, the Dallas Court of Appeals affirmed the ultimate sanction against a plaintiff whose “flagrant disregard” of the trial court’s discovery orders “demonstrated bad faith in the litigation process as a whole.” The case offers a roadmap to the type of record and extent of documentation required to justify death-penalty sanctions.<br /><br />Citing alleged misrepresentations of material facts the policyholder (Ayati), Farmers Insurance denied a claim under a homeowner’s policy for $600,000 worth of property (including “bricks or bundles of Zimbabwean currency, a 103” TV, an antique King-size bed, and several Persian rugs”) reported stolen from a second-story condominium. Ayati sued Farmers, and the discovery battles began. Farmers repeatedly complained to the court of Ayati’s incomplete answers to written discovery, as well as evasive or untruthful deposition testimony.<br /><br />The trial court held five discovery hearings in 14 months, and repeatedly ordered Ayati to produce requested documents and information related to his financial condition; claims, litigation, and criminal history; acquisition of the allegedly stolen currency and other property; eBay transactions; and other matters. (During this period, Ayati was represented by a series of at least three attorneys; the first two withdrew because of “irreconcilable differences” or lack of communication.) Finally, after finding Ayati had not complied with its previous orders and had provided testimony that “strains credibility,” the trial court struck Ayati’s pleadings, dismissed his claims with prejudice, and ordered him to pay court costs.<br /><br />The Dallas Court of Appeals reviewed the record, including the trial court’s 13-page order detailing the chronology and explaining its conclusion that less stringent sanctions would be insufficient. Applying the standards articulated in its own opinions and by the Supreme Court of Texas, the Court held the trial court had not abused its discretion. In short, the Court determined the sanction “had a direct relationship to Ayati’s conduct and was not excessive.” Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-44584809786609372542018-12-06T17:11:00.000-06:002018-12-06T17:11:20.242-06:00NO SUMMARY JUDGMENT ON AMBIGUOUS CONTRACT<i>Ticer v. Reed Migraine Centers of Texas, PLLC</i><br />Dallas Court of Appeals, No. 05-17-00721-CV (December 4, 2018)<br />Justices Lang, Fillmore, and Schenck (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=47b7dc08-315c-4f51-a995-8eeac611aa0e&amp;MediaID=5d234f23-1793-4dab-8504-7959bd3bb739&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://2.bp.blogspot.com/-al07H9tWNR8/XAmnEolGpcI/AAAAAAAABEw/MoA38HvRtIo1-o5swaXeBPOR8vRoDse4gCLcBGAs/s1600/VegasVague.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="869" data-original-width="1600" height="108" src="https://2.bp.blogspot.com/-al07H9tWNR8/XAmnEolGpcI/AAAAAAAABEw/MoA38HvRtIo1-o5swaXeBPOR8vRoDse4gCLcBGAs/s200/VegasVague.png" width="200" /></a></div>Although the facts are a little complicated, this case reiterates a basic principle—ambiguous contract terms create fact issues that ordinarily cannot be resolved by summary judgment.<br /><br />Mark Ticer represented Reed Migraine Centers and related entities (the “Reed parties”) in two lawsuits (state and federal) alleging breach of contract and unfair competition by Universal General Hospital and three doctors (the “UGH parties”). That suit resulted in a mediated settlement requiring the UGH parties to make a series of payments to the Reed parties. Shortly after the mediation, Ticer’s representation ended and a fee dispute arose; he withdrew as counsel and intervened in the state court lawsuit to recover his fees. The Reed parties counterclaimed for malpractice, and Ticer filed a third-party petition against his two former co-counsel for contribution. The Reed parties and the attorneys then entered into a separate settlement agreement (the “Ticer agreement”) under which Ticer would receive a portion of the UGH parties’ payments to the Reed parties and the settling parties would exchange mutual releases and dismiss all claims against each other.<br /><br />Two months later, before making any payments under the previous settlement with the Reed parties, UGH filed bankruptcy, triggering an automatic stay of the state court action. The following year, the Reed parties again settled with the UGH parties, and the federal court ordered the entire settlement amount be deposited in the court’s registry and not distributed pending disposition of the state court action. After the state court lifted the stay and severed the claims against the UGH parties, the Reed parties sought summary judgment declaring Ticer’s claims had been released by the Ticer agreement. The court granted that motion. Ticer appealed.<br /><br />The Dallas Court of Appeals reversed and remanded. The primary issue on appeal was whether the mutual releases were effective immediately upon execution of the agreement, or only after the contemplated payments were made. The court reviewed several provisions of the Ticer agreement and found some terms suggested immediate effect (e.g., “hereby releases”) while others suggested the releases were contingent on the contemplated payment (e.g., dismissal “within 3 days following the receipt of payments”). Finding it was “unable to harmonize the … provisions to give effect to all provisions,” the Court concluded the agreement was “reasonably susceptible to more than one meaning” and thus ambiguous. The ambiguity created a fact issue that made summary judgment improper, requiring remand to the trial court for resolution.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-58401442631481598822018-11-30T14:48:00.000-06:002018-11-30T14:48:38.478-06:00THE TCPA’S FINAL FRONTIER? COURT OF APPEALS DECLINES TO ADDRESS WHETHER TCPA APPLIES TO FAMILY LAW CASE<i>Smith v. Malone</i><br />Dallas Court of Appeals, No. 05-18-00216-CV (November 27, 2018)<br />Justices Myers, Evans (Opinion, linked <a href="http://www.search.txcourts.gov/SearchMedia.aspx?MediaVersionID=7e437ac4-d7ab-4e23-9799-da976f29e9fd&amp;coa=coa05&amp;DT=Opinion&amp;MediaID=2fccf2c9-d366-4764-a29b-b314e0efded5" rel="nofollow" target="_blank">here</a>), and Brown<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/brent-m-rubin/" rel="nofollow" target="_blank">Brent Rubin</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://4.bp.blogspot.com/-9eFRH2E7YO4/XAGc9r4W8rI/AAAAAAAABEc/wuWvhDwkRecKJwZPiWvWLElYuRE66tHHACLcBGAs/s1600/solar-system-emergence-spitzer-telescope-telescope-41951.jpeg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="400" data-original-width="640" height="125" src="https://4.bp.blogspot.com/-9eFRH2E7YO4/XAGc9r4W8rI/AAAAAAAABEc/wuWvhDwkRecKJwZPiWvWLElYuRE66tHHACLcBGAs/s200/solar-system-emergence-spitzer-telescope-telescope-41951.jpeg" width="200" /></a></div>Recently, Texas courts have applied the Texas Citizens Participation Act (TCPA) to cases far afield from the defamation claims typically targeted by anti-SLAPP statutes. For instance, the TCPA has been wielded in commercial disputes to secure expedited dismissal of fraud and misappropriation-of-trade-secrets claims. In <i>Smith v. Malone</i>, the Dallas Court of Appeals was asked to apply the TCPA in an even more unexpected context: a family law dispute.<br /><br />Malone and Smith had a son together. Several years later, Malone filed a suit requesting that both parents be named joint managing conservators of the child, with Malone having the right to designate the child’s primary residence. Smith moved to dismiss under the TCPA, alleging that Malone filed the suit in response to her request that the Texas Attorney General assist her in obtaining child support from Malone (an alleged exercise of her “right to petition,” protected by the TCPA). Smith provided text messages purporting to show that when she told Malone she was seeking child support, Malone responded that he would seek custody of their son. The trial court denied Smith’s motion, and Smith brought an interlocutory appeal, as the TCPA permits.<br /><br />Although the Court of Appeals acknowledged that the TCPA does not contain an express exception preventing its application to custody proceedings or family matters (as it does for other types of claims), the Court declined to address whether the TCPA applied to Malone’s suit. Instead, the Court concluded that even if the TCPA applied, dismissal would be inappropriate because Malone established a prima facie case on the challenged claim, as the TCPA requires for a plaintiff to avoid dismissal. As the undisputed father of the child, Malone was entitled to an order determining conservatorship without proving any more. Evidence about what would be in the child’s best interest—the standard used to determine the substance of the conservatorship order—was not necessary to establish Malone’s prima facie case. The Court therefore affirmed the denial of Smith’s TCPA motion to dismiss.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-42408219450654151122018-11-29T17:24:00.000-06:002018-11-29T17:24:08.197-06:00PRESIDENT’S DIRECTION DID NOT SURVIVE MOTION TO SHOW AUTHORITY<i>Candle Meadows Homeowners Ass’n v. Jackson</i><br />Dallas Court of Appeals, No. 05-17-01227-CV (November 27, 2018)<br />Justices Lang-Miers, Fillmore (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=bdaa0e37-1b06-4715-9844-d6c67a09095c&amp;MediaID=c2020c6e-4061-4fde-8191-498c478f5590&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), and Myers<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://3.bp.blogspot.com/-Z_BGTB-35uY/XAB0kVJ2EBI/AAAAAAAABEI/Hq0_tfu4xls94EafK8-skdKaQkOorFZWACLcBGAs/s1600/dismissed.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="177" data-original-width="232" height="152" src="https://3.bp.blogspot.com/-Z_BGTB-35uY/XAB0kVJ2EBI/AAAAAAAABEI/Hq0_tfu4xls94EafK8-skdKaQkOorFZWACLcBGAs/s200/dismissed.jpg" width="200" /></a></div>You are hired by an organization to investigate claims against certain parties, and the organization’s president later directs you to file a lawsuit on those claims. Do you have authority to file suit? Maybe not, a recent case reveals.<br /><br />The Board of Directors of Candle Meadows Homeowners Association voted to retain a lawyer to investigate certain expenditures by former board members. The HOA’s president later told the lawyer the board had voted to file suit against the former directors, and directed him to proceed. After the lawsuit had been pending about a year, the defendants filed a Motion to Show Authority under Rule 12 of the Texas Rules of Civil Procedure. At a hearing on the motion, the president testified the board had voted to authorize the lawyer to file the lawsuit, but he could not recall the date of the meeting and had no minutes documenting such an action. The other directors confirmed they had discussed the claims, but there was no formal vote on the matter. They were, however, aware of the suit after it was filed and did not seek to have it dismissed. Finding the board had not authorized the litigation, the trial court granted the motion and struck the HOA’s pleadings.<br /><br />The Dallas Court of Appeals affirmed. Although the lawyer apparently received authorization from the HOA’s president, there was no evidence the board had delegated that authority to the president. The Court deferred to the trial court’s assessment of the conflicting testimony of the president and the directors. Additionally, the absence of any notice to HOA members, agenda, or minutes of a meeting reflecting official action complying with the Open Meetings Act was dispositive. The Court rejected the argument that the board had “ratified” the president’s decision “by acquiescence” (i.e., failing to take action after learning of the suit) because there was no evidence the board had been given “all material facts.”<br /><br />For lawyers, the lesson is: Be sure you have the necessary authority before filing a lawsuit on behalf of an entity, especially one that may be subject to the Open Meetings Act. And for directors and officers of such an organization, the lesson is: Follow the procedures required by statute and the organization’s bylaws.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-3542722333601514742018-11-29T09:40:00.000-06:002018-11-29T09:40:43.983-06:00IT JUST AIN’T RIGHT: NO-ANSWER DEFAULT JUDGMENT AGAINST DEFUNCT CORPORATION DOESN’T BIND ITS OFFICERS AND DIRECTORS<i>Christian v. Venefits, LLC</i><br />Dallas Court of Appeals, No. 05-17-01218-CV (November 27, 2018)<br />Justices Bridges, Francis (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=9eaf17e3-51c1-4945-a6ee-a8996c38165c&amp;coa=coa05&amp;DT=Opinion&amp;MediaID=8e4b826e-d453-4ccf-b921-9dc3d7393c69" rel="nofollow" target="_blank">here</a>), and Lang-Miers<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://3.bp.blogspot.com/-kZbWwPp1vGM/XAAHmFS0N9I/AAAAAAAABD0/0KWOjsTC-O0SmnglYUnZ_0pHoGABbdSxACLcBGAs/s1600/default.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="200" data-original-width="300" height="133" src="https://3.bp.blogspot.com/-kZbWwPp1vGM/XAAHmFS0N9I/AAAAAAAABD0/0KWOjsTC-O0SmnglYUnZ_0pHoGABbdSxACLcBGAs/s200/default.jpg" width="200" /></a></div>It’s one of those things that just doesn’t seem right, but still, you’re not 100% sure about it. You represent a party who’s alleged to be vicariously liable for, or jointly and severally liable with, a co-defendant who fails to answer and suffers a default. Is the wrongful conduct that would lead to your client’s vicarious or joint liability now established by that default judgment? Nope, says the Dallas Court of Appeals —at least if your client had no right to answer for the defaulting co-defendant or defend in its behalf.<br /><br />Venefits sued VIPCO and its officers and directors for, among other things, breach of contract. Before the alleged breach, VIPCO had failed to file a franchise tax report and therefore had forfeited its right to do business in Texas, as well as to sue or defend in a court of this State. Under §§ 171.252 and 171.255 of the Texas Tax Code, directors and officers are personally liable for a corporation’s debts incurred after its corporate privileges are forfeited and before those rights are revived. VIPCO failed to appear and answer, and Venefits secured a no-answer default against it. Then, relying on that default judgment against VIPCO and §§ 171.252 and 171.255 of the Tax Code, Venefits obtained summary judgment for that corporate “debt”against Christian—the former president of VIPCO and the only defendant who had filed an answer in the case. Christian appealed, arguing a no-answer default against one party does not bind another party or deny that party an opportunity to assert defenses. And the Dallas Court of Appeals agreed, citing its own prior opinions in <i>Mayfield v. Hicks</i> and W<i>innard v. J. Grogan</i>, as well as the Corpus Christi court’s decision in <i>Brazos Valley v. Robinson</i>. In <i>Mayfield</i>, the Dallas Court had held that answering guarantors were wrongly saddled with the no-answer default of their principal in a lease dispute. And in <i>Winnard</i> and <i>Brazos Valley</i>, rejected arguments that answering employers were vicariously liable based on defaults entered against their non-answering employees. In each case, as in this one, the bases for holding the answering party vicariously liable—<i>if</i> the primary defendant were found to have committed the alleged wrong—were not in dispute. Nevertheless, the Court said, it is a “fundamentally unfair use of a default judgment” to bind an answering party, based solely on a non-answering party’s default, where the answering party is given no opportunity to defend the charges of wrongful conduct on the merits. The Dallas Court of Appeals therefore reversed the summary judgment against Christian and remanded for further proceedings.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-75313199270430456542018-11-15T17:02:00.000-06:002018-11-15T17:02:40.020-06:00MANDAMUS GRANTED TO SORT OUT POST-JUDGMENT “PROCEDURAL QUAGMIRE” IN CONDEMNATION PROCEEDING<i>In re State of Texas</i><br />Dallas Court of Appeals, No. 05-18-00685-CV (November 14, 2018)<br />Justices Lang, Myers (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=66089f11-9a75-4c7b-9159-b66ad1305901&amp;MediaID=e398324f-e6a7-4bdf-9a74-3f465ebaec75&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), and Whitehill<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://2.bp.blogspot.com/-VkdrH0NW1Oc/W-36BftVfPI/AAAAAAAABDg/yEmt95yH3bwwGLR30ZRHkywvMebqyvltwCLcBGAs/s1600/Quagmire.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="356" data-original-width="513" height="138" src="https://2.bp.blogspot.com/-VkdrH0NW1Oc/W-36BftVfPI/AAAAAAAABDg/yEmt95yH3bwwGLR30ZRHkywvMebqyvltwCLcBGAs/s200/Quagmire.jpg" width="200" /></a></div>The State of Texas condemned part of EnergyTransfer Fuel’s pipeline easement, as well as other property, for a TxDOT road-widening project. The State and ETF reached a joint-use agreement that included an agreed dismissal of the condemnation claims against ETF. The remainder of the condemnation case proceeded to a jury trial that ended on May 5, 2017. On that same day, ETF filed a claim for statutory attorney’s fees incurred prior to its dismissal, under Texas Property Code §§ 21.019 &amp; 21.0195. On May 12, the trial court issued its judgment on the jury verdict. That judgment did not specifically address ETF’s request for fees, but it ordered ETF dismissed and contained “magic” finality language: “This Judgment is a final judgment as to all claims of all parties to this action and is appealable. All other relief not expressly granted in this Judgment is denied.” And then the fun began. The “procedural quagmire” went like this:<br /><br /><ul><li>May 5 — Jury verdict and ETF notice of request for fees</li><li>May 12 — “Final” judgment</li><li>May 17 —ETF files fee evidence</li><li>July 5 —ETF files motion to vacate and modify the May 12 judgment</li><li>July 6 — Trial court issues order denying ETF’s fee request</li><li>August 4 — Trial court holds hearing on ETF’s motion to vacate and modify</li><li>August 9 — Trial court issues order granting motion to vacate May 12 judgment and awards fees to ETF</li><li>August 23–February 1 —Trial court issues six more orders correcting or adjusting the fee award, vacating prior orders, etc.</li></ul><br />The State filed a mandamus petition, arguing all orders after the May 12 judgment were void because they were issued after the trial court’s plenary power expired. ETF countered that (1) the May 12 judgment was not final until the trial court ruled explicitly on its fee request, and so the trial court had plenary power to issue its subsequent orders; and (2) the State’s request for mandamus relief was barred by laches.&nbsp;<br /><br />The Dallas Court of Appeals took something of a middle road, but in the end granted the State the relief it sought. <i>First</i>, it summarily rejected ETF’s laches argument, observing that the State had tried at every turn to preserve its rights in the trial court. <i>Next</i>, the Court explained that a claim for statutory fees in a condemnation case does not accrue until after the condemnation proceeding is dismissed, and that a post-judgment claim for fees extends the trial court’s plenary power. Here, however, the May 12 judgment contained “finality language” that purported to dispose of all claims—presumptively including ETF’s May 5 fee claim, especially since it followed a jury verdict. So, the Court concluded that ETF’s May 5 request for statutory fees should be treated as a timely, albeit premature, motion to modify the May 12 judgment, which did extend the trial court’s plenary jurisdiction. ETF’s July 5 motion to modify, however, had no such effect, because it was directed to the May 12 judgment, from which plenary power had already been extended, and because it was filed outside the time limit of Rule 329b(a) &amp; (b). When the trial court issued its July 6 order denying ETF’s fee request—effectively denying the premature, de facto motion to modify the May 12 judgment—that started the 30-day clock again. No motions were filed between then and August 7, so plenary power expired. All orders and modified judgments signed after August 7 therefore were void. The Court of Appeals therefore ordered them vacated and the May 12 judgment reinstated as final. No statutory fees for ETF. Moral: Carefully track the timing of final judgments and post-judgment motions to extend plenary power, even in a quagmire.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-87167932502554203472018-11-09T11:09:00.001-06:002018-11-09T11:09:47.135-06:00ARBITRATORS HAVE TO FOLLOW THE CERTIFICATE-OF-MERIT RULES, BUT THERE IS NO INTERLOCUTORY REVIEW IF THEY DON'T<i>SM Architects, PLLC&nbsp;v. AMX Veteran Specialty Services, LLC</i><br />Dallas Court of Appeals, No. 05-17-01064 (November 8, 2018)<br />Justices Bridges, Francis&nbsp;(opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=c834402a-e3b3-4f67-a8bd-227216c50b62&amp;MediaID=baf41bc8-41d5-4cd8-aaa4-f72cbcc17080&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" target="_blank">here</a>), and Lang-Myers<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><br /></div><div class="separator" style="clear: both; text-align: center;"><a href="https://2.bp.blogspot.com/-s7apI6vetgY/W-W9GJrI-1I/AAAAAAAABDM/hHq02-DT7Ogceg5aC7606i2SFi4YmeBJwCLcBGAs/s1600/Architecture%2Bphoto.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="354" data-original-width="530" height="133" src="https://2.bp.blogspot.com/-s7apI6vetgY/W-W9GJrI-1I/AAAAAAAABDM/hHq02-DT7Ogceg5aC7606i2SFi4YmeBJwCLcBGAs/s200/Architecture%2Bphoto.jpg" width="200" /></a></div>In a court action or arbitration based on the provision of professional architectural services, a plaintiff must file a certificate-of-merit affidavit by a third-party licensed architect in support of its claims. TEX. CIV. PRAC. &amp; REM. CODE § 150.002. If a trial court denies a motion to dismiss the case for failure to comply with this requirement, that ruling is immediately appealable under § 150.002(f). But what is the remedy if an arbitrator refuses to dismiss? <br /><br />&nbsp;In this case of first impression, the Dallas Court of Appeals concluded there is no remedy—at least not before the arbitration is over. The courts’ jurisdiction over arbitration proceedings is limited to enforcing the agreement and rendering judgment on an “award.” TEX. CIV. PRAC. &amp; REM. CODE §171.081. An “award” is a “judgment, sentence, or final decision” and does not include interlocutory orders. The Court acknowledged that, by enacting § 150.002(f), the legislature intended to provide parties the right to immediately challenge a trial court’s decision about whether a plaintiff has met the certificate-of-merit requirement, but it found no evidence of an intent to “significantly alter the jurisdictional limitations on courts with respect to arbitration proceedings.” The defendants tried several different approaches and arguments to obtain review of the order denying their motion to dismiss, but the Court concluded “there is no further relief we can grant, or action we can compel the trial court to take, with respect to the panel’s decision.”<br /><br />&nbsp;.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-5458001332770376862018-11-09T08:24:00.000-06:002018-11-12T11:41:43.138-06:00JUST PLEADING AN AFFIRMATIVE DEFENSE WON'T DEFEAT SUMMARY JUDGMENT<div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-ZHqfeFB_N2I/WIu9XcMew4I/AAAAAAAAApY/Gaw7BLdzL_McsiF3Jt6CJTITnPVvBU71ACPcBGAYYCw/s1600/TexasBarToday_TopTen_Badge_June2016%2B72pixels.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="102" data-original-width="72" src="https://1.bp.blogspot.com/-ZHqfeFB_N2I/WIu9XcMew4I/AAAAAAAAApY/Gaw7BLdzL_McsiF3Jt6CJTITnPVvBU71ACPcBGAYYCw/s1600/TexasBarToday_TopTen_Badge_June2016%2B72pixels.jpg" /></a></div><div class="separator" style="clear: both; text-align: center;"></div><div class="separator" style="clear: both; text-align: center;"></div><em>Matkin v. American Express Centurion Bank</em><br />Dallas Court of Appeals, No. 05-17-01438-CV (November 7, 2018)<br />Justices Bridges, Francis (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=08e6d8bc-d6b5-494e-b1e0-1dd6183183cd&amp;MediaID=2bc08d01-d548-4e4d-909f-5495bccf8715&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" target="_blank"><span style="color: red;">here</span></a>), and Lang-Miers<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><br /></div><div class="separator" style="clear: both; text-align: center;"><a href="https://2.bp.blogspot.com/-HWToRzAQDTE/W-WUrvfTvmI/AAAAAAAABC4/t3qAsS3Z8Q4odPVEigEg43GfWxnC6EkowCLcBGAs/s1600/American%2BExpress2.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="133" data-original-width="216" height="123" src="https://2.bp.blogspot.com/-HWToRzAQDTE/W-WUrvfTvmI/AAAAAAAABC4/t3qAsS3Z8Q4odPVEigEg43GfWxnC6EkowCLcBGAs/s200/American%2BExpress2.jpg" width="200" /></a></div><br /><br />In this brief opinion, the Dallas Court of Appeals affirmed summary judgment for American Express despite the cardholder's affirmative defense of limitations.&nbsp; In doing so, the Court reminded us of a couple of fundamental rules:<br /><br /><br /><ul><li>&nbsp;"A plaintiff is under no initial obligation to negate affirmative defenses when moving for summary judgment and the mere pleading of an affirmative defense will not prevent summary judgment in favor of a plaintiff who establishes an absence of fact issues on his own claim for relief"; and</li><br /><li>The four-year statute of limitations for breach of contract based on credit-card debt begins to run "on the date the last payment on the account is made."</li></ul>Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-36069117664739672672018-10-25T16:18:00.000-05:002018-10-25T16:18:47.971-05:00UNCONDITIONAL SEVERANCE ORDER STARTS THE APPELLATE CLOCK, EVEN BEFORE THE NEWLY SEVERED CASE IS DOCKETEDAZS Holding Company LLC v. Khosh-Sirat<br />Dallas Court of Appeals, No. 05- 18-00845-CV (October 24, 2018)<br />Justices Stoddart, Whitehill (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=af2ccc3b-39a4-4c9f-a071-4ab93aba73e1&amp;MediaID=6612de1e-8de1-4110-8db4-3e5b124df12f&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), and Boatright<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://3.bp.blogspot.com/-ncn2XKwLwpo/W9IxhzrwG-I/AAAAAAAABCE/l0ah6LXLsQojGx6XE5XajmyEtN3FS_-3QCLcBGAs/s1600/Severance.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="112" data-original-width="216" height="103" src="https://3.bp.blogspot.com/-ncn2XKwLwpo/W9IxhzrwG-I/AAAAAAAABCE/l0ah6LXLsQojGx6XE5XajmyEtN3FS_-3QCLcBGAs/s200/Severance.png" width="200" /></a></div>AZS suffered a default judgment in May of 2017. But because there were other parties to the case, that judgment didn’t become final until August of 2017 when the trial court severed the claims and judgment against AZS. As is common, the severance order directed that those claims and that default judgment be severed from the existing case “into a new cause … which will be docketed as Cause No. ________________.” The filing fee for this new cause was not paid and the new cause was not opened until May of the following year. AZS filed a motion for new trial in the new cause, which was not granted, and then attempted to appeal the default judgment.<br /><br />The Dallas Court of Appeals, however, dismissed the appeal as untimely. Although the severance order contained a blank for the “new cause” number and despite the fact the new cause was not actually docketed for several months, the order of severance was not conditioned on the opening of that new cause. “Whether the trial court clerk ever creates a physically separate file or assigns a new cause number,” the Court said, “does not affect the finality of an unconditional severed judgment.” Consequently, the appellate clock began ticking when the order of severance was entered. So, AZS’s appeal, filed almost a year later, was untimely. Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-5734876436561422582018-10-12T07:43:00.001-05:002018-10-12T07:43:30.840-05:00“SPECIAL DEFECTS” AND GOVERNMENTAL IMMUNITY—SIZE MATTERS<i>City of Lancaster v. LaFlore</i><br />Dallas Court of Appeals, No. 05-17-01443-CV (October 10, 2018)<br />Justices Bridges, Francis, and Lang-Miers (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=6ed5e66b-1dc9-4733-a272-bd126a3bd14b&amp;MediaID=d600a6e6-22b4-4213-b91b-15e96a9f8538&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><a href="https://2.bp.blogspot.com/-cGCpqDvxNQc/W8CWWChmd9I/AAAAAAAABBw/z_u7kqHA3wU4iVUYA22PRDQrDFBy3zYHwCLcBGAs/s1600/Picture1.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="272" data-original-width="387" height="140" src="https://2.bp.blogspot.com/-cGCpqDvxNQc/W8CWWChmd9I/AAAAAAAABBw/z_u7kqHA3wU4iVUYA22PRDQrDFBy3zYHwCLcBGAs/s200/Picture1.png" width="200" /></a>While driving in Lancaster, LaFlore ran over a manhole with a partially dislodged cover, causing him to lose control of his car and hit a tree, injuring himself and his children who were passengers. He sued the City, which moved to dismiss, claiming governmental immunity. The trial court denied the City’s motion, but the Dallas Court reversed on appeal.<br /><br />The Texas Tort Claims Act provides a limited waiver of governmental immunity in personal injury cases caused by “special defects” on roadways and other public premises. Whether a condition is a “special defect” is a question of law that the court of appeals reviews de novo—although “courts consider each case’s ‘unique facts’” in making that decision. Drawing upon opinions from the Texas Supreme Court, the Dallas Court explained that the waiver of immunity for “special defects” on city streets is to be narrowly construed; the condition must “fall[] within the same class as an excavation or obstruction” on a roadway. The characteristics that will guide this determination include “(1) the size of the condition; (2) whether the condition unexpectedly and physically impairs an ordinary user’s ability to travel on the road; (3) whether the condition presents some unusual quality apart from the ordinary course of events; and (4) whether the condition presents an unexpected and unusual danger.”<br /><br />Winding its way through a number of cases that had found open manholes and uncovered water meter boxes to be “special defects”— where pedestrians or bicycles were involved, but not automobiles—and others that had not, the Court ultimately concluded the condition here did not fall into the class of “excavations or obstructions” on a roadway. The manhole was about two feet wide and was located directly on the center strip of the street. Motorists like LaFlore did not have to alter their “normal course of travel” or leave their lanes of traffic to avoid it. It was, therefore, unlike the much larger potholes and excavations the Court previously had found to be “special defects.” Nor, the Court lamented, was a dislodged manhole cover “some unusual quality apart from the ordinary course of events,” but instead, something drivers should have come to expect nowadays.<br /><br />In sum, the Court said, “not every hole or hindrance is special.” This one, alas for LaFlore, was not. And so the court of appeals reversed and rendered judgment for the City. Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-16309406436627555552018-09-19T17:13:00.000-05:002018-10-01T11:13:47.203-05:00JURISDICTION AFTER MANDATE, OR, “WE REALLY MEANT IT.”<div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-ZHqfeFB_N2I/WIu9XcMew4I/AAAAAAAAApY/Gaw7BLdzL_McsiF3Jt6CJTITnPVvBU71ACPcBGAYYCw/s1600/TexasBarToday_TopTen_Badge_June2016%2B72pixels.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="102" data-original-width="72" src="https://1.bp.blogspot.com/-ZHqfeFB_N2I/WIu9XcMew4I/AAAAAAAAApY/Gaw7BLdzL_McsiF3Jt6CJTITnPVvBU71ACPcBGAYYCw/s1600/TexasBarToday_TopTen_Badge_June2016%2B72pixels.jpg" /></a></div><i>In re F.A. Brown’s Construction, LLC</i><br />Dallas Court of Appeals, No. 05-18-00804-CV (September 18, 2018)<br />Justices Lang-Miers (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=6c27ab8f-9087-4785-b854-c90e997ebce2&amp;MediaID=640d9b03-36f5-4840-831e-e588184b3160&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), Fillmore, and Stoddart<br /><div style="text-align: right;"><a href="http://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-akU_ckA_UZc/W6LJaWpyM_I/AAAAAAAABBc/dMwsu3E2uHIqsrJ5UbdYfWbsnmZbSY-kQCLcBGAs/s1600/I%2Bmeant%2Bit%2Bwhen%2Bi%2Bsaid%2Bit.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="333" data-original-width="333" height="200" src="https://1.bp.blogspot.com/-akU_ckA_UZc/W6LJaWpyM_I/AAAAAAAABBc/dMwsu3E2uHIqsrJ5UbdYfWbsnmZbSY-kQCLcBGAs/s200/I%2Bmeant%2Bit%2Bwhen%2Bi%2Bsaid%2Bit.jpg" width="200" /></a></div>The Dallas Court of Appeals granted mandamus when a trial court failed to follow its mandate from an earlier appeal. In the process, it explained the scope of a trial court’s jurisdiction when faced with a mandate, and the scope and duration of both courts’ jurisdiction when the trial court doesn’t follow the mandate.<br /><br />Brown’s Construction sued Ken-Do Contracting for breach of contract. Brown alleged venue in Dallas; Ken-Do argued for transfer to Ellis County. The trial court sustained venue in Dallas, and the case proceeded to judgment there after a jury trial. On appeal, the Fifth Court found neither party had made the necessary venue showing, reversed the judgment, and remanded with specific instructions for the trial court “to conduct further proceedings on the issue of venue.” The trial court then peremptorily ordered the case transferred to Johnson County—a venue sought by neither party— without “conducting further proceedings,” as directed by the mandate. When Brown filed a motion to reconsider, the trial court acknowledged its transfer order was in error, but denied the motion because, it said, its plenary jurisdiction had expired. Brown then sought mandamus. Ken-Do acknowledged the transfer order was erroneous, but opposed mandamus, arguing that neither the trial court nor the Court of Appeals had jurisdiction to do anything about it—in part because of the trial court’s loss of plenary power and also because Johnson County lies outside the Appeals Court’s territorial jurisdiction, making it impossible for the Court of Appeals to order the transferee court to return the case to Dallas.<br /><br />What a mess, right? But the Dallas Court promptly cleaned it up.<br /><br />What is at stake here, the Court of Appeals explained, is an appellate court’s authority to enforce its judgments—in this case, the earlier judgment and mandate directing the trial court to “conduct further proceedings on the issue of venue” and only then to act on the issue. On remand, the trial court’s jurisdiction was limited to effectuating the mandate issued by the Court of Appeals. The appeals court retains jurisdiction for as long as necessary to ensure the trial court follows its instructions. Delays in the trial court—even those that would seem to deprive that court of plenary jurisdiction generally—do not impair the appeals court’s jurisdiction to ensure compliance with its prior mandate, by way of mandamus, or the trial court’s jurisdiction to effectuate that renewed directive. The Court of Appeals therefore granted mandamus, ordering the trial court to vacate its transfer order and to conduct the further proceedings on venue as ordered originally.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-20363409889494748292018-07-13T15:16:00.004-05:002018-07-13T15:17:21.134-05:00SHADE ≠ TREE OWNERSHIP<i>4415 W Lovers Lane, LLC v. Stanton</i><br />Dallas Court of Appeals, No. 05-17-01363-CV (July 12, 2018)<br />Bridges (opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=5bf5fde4-a043-48ee-8608-9af75a5ae132&amp;MediaID=99e0b241-5471-47e6-b195-c69b9cbe7758&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), Myers, and Schenck<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-Uo8pPpDk0RI/W0kIelDqdBI/AAAAAAAABBA/eMCBcSELyAUkQ5Nw37baYwZ2tGdYQndTgCLcBGAs/s1600/tree.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="497" data-original-width="398" height="200" src="https://1.bp.blogspot.com/-Uo8pPpDk0RI/W0kIelDqdBI/AAAAAAAABBA/eMCBcSELyAUkQ5Nw37baYwZ2tGdYQndTgCLcBGAs/s200/tree.jpg" width="160" /></a></div>The Stantons sued 4415 W Lovers Lane, LLC and got a temporary injunction preventing the company from cutting down a large tree growing along the property line between them. The Stantons were building a house on their property, and they claimed the design of the house “was to include a large window to look out on to the large elm tree.” They argued removal of the tree “would diminish the current market and intrinsic value” of their property. The Court of Appeals dissolved the injunction, finding the Stantons had not established a probable right to recovery because they did not own the tree. Mr. Stanton testified that only about one-fifth of the trunk crossed over the property line onto his property, but argued the canopy (and resulting shade) covered half the house, and the tree provided privacy. But the appellate court was not convinced, citing a Texas Supreme Court opinion from 1900 holding that “a tree and all its roots and branches belong to the owner of the soil upon which its trunk stands.” And it noted that trees that start life on one property and grow onto a neighboring property do not automatically become boundary-line trees, and thus joint property, merely by touching a property line.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-70368682573227095702018-06-15T16:12:00.000-05:002018-06-15T16:12:14.160-05:00KMH SCOTX: INSURANCE AGENTS MAY KNOW MORE ABOUT REASONABLE AND NECESSARY MEDICAL EXPENSES THAN DOCTORS AND HOSPITALS<i>Gunn v. McCoy</i><br />Supreme Court of Texas, No. 16-0125 (June 15, 2018)<br />Justice Green’s opinion linked <a href="http://www.txcourts.gov/media/1441837/160125.pdf" rel="nofollow" target="_blank">here</a><br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-3Lkv_wk_ePo/WyQq9OqHfOI/AAAAAAAABAM/RYnTuoCNyo0QEre4AvzR5k9D1pxFhv1bgCLcBGAs/s1600/laptop.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="267" data-original-width="450" height="118" src="https://1.bp.blogspot.com/-3Lkv_wk_ePo/WyQq9OqHfOI/AAAAAAAABAM/RYnTuoCNyo0QEre4AvzR5k9D1pxFhv1bgCLcBGAs/s200/laptop.png" width="200" /></a></div>The central issue in this medical malpractice case was whether the plaintiffs put on legally sufficient evidence that the patient’s hypoxic brain injury was caused by the defendant doctor’s failure to administer fresh frozen plasma to counteract the patient’s severe blood loss, as opposed to being caused by naturally-occurring blood clots in the brain. The Court held that the jury could have reasonably accepted the testimony of plaintiffs’ expert over defendants’ expert and affirmed a multi-million judgment against the doctor.<br /><br />But of more general significance was the Court’s holding regarding medical-expense affidavits. CPRC section 18.001 governs proving expenses by affidavit, and it is common to use section 18.001 affidavits as evidence of the reasonableness and necessity of past medical expenses. Unless a controverting affidavit is served as provided by section 18.001, an affidavit stating that the amount a person charged for a service was reasonable at the time and place that the service was provided and that the service was necessary is sufficient evidence to support a finding of fact that the amount charged was reasonable and that the service was necessary. To comply with this section, an affidavit must be made by “(A) the person who provided the service; or (B) the person in charge of records showing the service provided and the charge made.” Consistent with other parts of the CPRC, the amount listed on the affidavit must be limited to the amount actually paid or incurred, not the amount billed.<br /><br />Typically, these affidavits are signed by someone in the medical provider’s office and, in this case, the plaintiffs submitted 14 provider affidavits regarding the reasonableness and necessity of the patient’s past medical expenses based on the amounts billed. Plaintiffs later withdrew those affidavits, however, and replaced them with affidavits from subrogation agents for the health insurance carriers that had actually paid the patient’s medical expenses. The new affidavits reflected the amounts actually paid. But defendants objected to these affidavits arguing that section 18.001 limits the proper affiants to providers or the record custodians for those providers.<br /><br />The Court disagreed. It held that, in today’s complex healthcare marketplace, the “list price” charged by a medical provider bears very little resemblance to the price ultimately paid by an insurance carrier or the federal government through the Medicare or Medicaid programs. Indeed, “it is not uncommon or surprising that a given medical provider may have no basis for knowing what is a ‘reasonable’ fee for a specific service.” By contrast, insurance companies regularly negotiate with providers to agree upon the actual prices and maintain records and databases of both the list prices and the actual prices of specific treatments and procedures. The Court concluded that insurance agents are, therefore, “generally well-suited to determine the reasonableness of medical expenses.” In addition, although the Court acknowledged that doctors are in the best position to determine what medical care is necessary, “for better or for worse, in the context of our health care system, what is ‘necessary’ is often heavily influenced by insurance companies and by what treatments and procedures they are willing to cover.” So, the Court held the subrogation agents’ affidavits were sufficient under section 18.001 to establish the reasonableness and necessity of past medical expenses. Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-80794851847755299822018-06-11T15:45:00.000-05:002018-06-11T15:45:29.146-05:00SCOT TWOFER ON “ULTRA VIRES”<i>Meyers v. JDC/Firethorne, Ltd.</i><br />Supreme Court of Texas, No. 17-0105 (June 8, 2018)<br />Justice Green’s Opinion linked <a href="http://www.txcourts.gov/media/1441816/170105.pdf" rel="nofollow" target="_blank">here</a><br /><br /><i>City of Houston v. Houston Municipal Employees Pension System</i><br />Supreme Court of Texas, No. 17-0242 (June 8, 2018)<br />Justice Johnson’s Opinion linked <a href="http://www.txcourts.gov/media/1441818/170242.pdf" rel="nofollow" target="_blank">here</a><br /><div style="text-align: right;"><a href="http://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://2.bp.blogspot.com/-L4PIW9drdEc/Wx7damzSrgI/AAAAAAAAA_0/Hd9mG0-_v_kxCceB7WoHXNFuNIgdu072ACLcBGAs/s1600/Twofer.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="443" data-original-width="650" height="136" src="https://2.bp.blogspot.com/-L4PIW9drdEc/Wx7damzSrgI/AAAAAAAAA_0/Hd9mG0-_v_kxCceB7WoHXNFuNIgdu072ACLcBGAs/s200/Twofer.png" width="200" /></a></div>The Texas Supreme Court issued two opinions on Friday, June 8, dealing with claims of governmental immunity and the concept of <i>“ultra vires”</i> actions. The cases reach different conclusions in applying immunity to different situations. In <i>Meyers</i>, the Court held a developer lacked standing to enjoin a county commissioner’s interference in a construction-application process over which the commissioner had no authority. In the <i>Houston</i> case, a dispute between two governmental bodies, the Court held the City had no discretion to circumvent a pension system’s determination of who was an “employee” for which the City was obligated to make pension contributions.<br /><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><br /></for><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><i>Meyers v. JDC/Firethorne, Ltd</i>. involved a dispute between a land developer and an individual county commissioner in Fort Bend County. JDC/Firethorne complained that Meyers, the elected commissioner for the precinct in which JDC/Firethorne sought to develop a new subdivision, was improperly interfering with the processing of plat applications and construction plans it had submitted for several sections of the proposed development. The developer sued Meyers in his individual and official capacities, as well the County and its chief engineer. The claim against Meyers in his official capacity was based on the argument that he was acting <i>ultra vires</i>, i.e. outside his legal authority, in his efforts to have the chief engineer delay processing of the plat applications to “exact a concession” on a related project. Meyers filed a plea to the jurisdiction on governmental-immunity grounds, arguing that he was exercising his authority and acting within his discretion, not <i>ultra vires</i>.</for><br /><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><br /></for><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""> The trial court denied the plea to the jurisdiction and entered an injunction ordering Meyers to “cease and desist … from instructing the [engineer] to ‘hold,’ ‘delay,’ or otherwise impede plats and construction plans submitted by JDC/Firethorne.” Meyers filed an interlocutory appeal, and the court of appeals affirmed. On review in the Texas Supreme Court, the parties continued to press their ultra vires arguments. The Supreme Court, however, took a different approach, <i>sua sponte</i>, and decided the core issue was whether the developer had standing to seek the injunction against Meyers.</for><br /><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><br /></for><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two="">The Court noted the plaintiff’s standing is essential to a court’s subject-matter jurisdiction, and has three elements: “the plaintiff suffered an injury, this injury is fairly traceable to the defendant’s conduct, and this injury is likely to be redressed by the requested relief.” The Court did not address the first two elements, finding the third dispositive. As the Court explained, “JDC/Firethorne’s insistence that Meyers has acted ‘without authority’ as to the plat-application process betrays the deficiency in standing—if Meyers has no legal power over the processing and presentment of plat applications, then JDC/Firethorne has not shown a substantial likelihood that its requested relief will remedy its alleged injury.” Under the County’s Regulation of Subdivisions, the county engineer was charged with processing plat applications and presenting them to the Commissioners Court. And Meyers “acts only as one member of a five-person body.” The Court noted, however, that the developer had sued “other defendants who could remedy its alleged injury”—the county engineer, the Commissioners Court, and the County. So, although the injunction against Meyers was vacated and the claims against him in his official capacity were dismissed, claims against him as an individual, as well as claims against the other defendants, remain in the trial court.</for><br /><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><br /></for><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two="">The second case, <i>City of Houston v. Houston Municipal Employees Pension System</i>, involved a dispute between two governmental entities, which the Court described as “a relationship that is not working out well.” Indeed, this was the Court’s second opinion addressing disputes concerning the Houston Pension System, which was organized and operates under section 6243h of the Texas Revised Civil Statutes. The City was required to contribute specific amounts to the Pension Fund for each City employee. To reduce its payment obligations, the City created three “local government corporations” and transferred many of its employees to those entities. The Pension System deemed all of the transferred individuals “employees” of the City, and a group of affected individuals, joined by the City, sued the Pension System. In <i>Klumb v. Houston Municipal Employees Pension System</i>, 458 S.W.3d 1 (Tex. 2015), the Court upheld the Pension System’s plea to the jurisdiction, holding its board did not act <i>ultra vires</i> when issuing its resolutions defining “employee” because the statute expressly granted that authority to the board.</for><br /><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><br /></for><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two="">After <i>Klumb</i>, the Pension System asked the City to provide payroll data and other related information on the transferred employees. The City did not provide the requested information, and did not contribute to the pension fund for those individuals. The Pension System sued for a writ of mandamus against the City, claiming it “acted <i>ultra vires</i> by failing to perform the purely ministerial function of providing the required employee information and by failing to budget for the retirement contributions.” The City filed a plea to the jurisdiction, which the trial court denied. The court of appeals affirmed, as did the Texas Supreme Court.</for><br /><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two=""><br /></for><for .="" a="" cases="" discussion="" of="" see="" sponte="" sua="" the="" two="">On the core issues, the Court held its holding in <i>Klumb</i> disposed of any argument concerning the Pension System’s statutory authority to define “employee,” and the statute “leaves no room for the City to exercise its discretion regarding whether the payments must be made” and the information provided. While the City retained discretion to determine <i><b>how</b></i> to comply, it had no discretion <b><i>not</i></b> to comply. Finally, the Court held the case was not rendered moot by 2017 amendments to the statute allowing the City to amortize its “legacy liability” over a thirty-year period. </for>Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-53862162098352903342018-05-29T11:50:00.000-05:002018-05-29T11:50:10.574-05:00UNINSURED MOTORIST COVERAGE REQUIRES LEGAL LIABILITY<i>Loncar v. Progressive County Mutual Insurance Co.</i><br />Dallas Court of Appeals, No. 05-16-00530-CV (May 24, 2018)<br />Justices Lang, Brown, and Whitehill (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=55447b78-4425-4b44-8dfb-bd4a21e625a8&amp;MediaID=9d63c6f9-056d-4da9-bd31-755f7ebbc9aa&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-VCXDip0IKz8/Ww1_Oa2e_JI/AAAAAAAAA_g/o488eHre8_IvRFHBNb8gGAL13QoX_N2tgCLcBGAs/s1600/Fire%2BTruck%2BWreck.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="432" data-original-width="768" height="112" src="https://1.bp.blogspot.com/-VCXDip0IKz8/Ww1_Oa2e_JI/AAAAAAAAA_g/o488eHre8_IvRFHBNb8gGAL13QoX_N2tgCLcBGAs/s200/Fire%2BTruck%2BWreck.jpg" width="200" /></a></div>Uninsured-motorist coverage protects you when you are injured or your car is damaged by another driver and that driver doesn’t have insurance that will cover your damages. Right? Not necessarily. The Dallas Court of Appeals affirmed a take-nothing judgment against a policyholder whose car was hit by a city fire truck because his claim against the city was barred by governmental immunity, and that precluded uninsured-motorist coverage under the terms of his policy.<br /><br />Brian Loncar’s car collided with a City of Dallas fire truck in 2008, and Loncar sued the City and the fire-truck driver for personal injuries. The defendants filed a plea to the jurisdiction that was granted in part and denied in part. While the interlocutory appeal of the jurisdictional ruling was pending, Loncar amended his petition to add claims against Progressive, the primary insurer, and Chubb, the excess insurer, for their refusal to pay on his policies. Ultimately, all claims against the City and its employee were dismissed on governmental immunity grounds, and the Texas Supreme Court denied review. The trial court subsequently granted summary judgment for both insurers, and Loncar appealed.<br /><br />The appeal turned on the language of the uninsured-motorist provisions in Loncar’s policies. A Texas standard form endorsement to the Progressive policy required the insurer to “pay damages which an insured is <i>legally entitled to recover</i> from the owner or operator of an uninsured motor vehicle because of bodily injury sustained by an insured.” (Emphasis added, internal quotations omitted.) The Chubb excess policy used used a different form, with language similar to that of the primary policy. The Court of Appeals held the plain meaning of both policies was that Loncar could not recover under the uninsured-motorist provisions because he was not “legally entitled to recover” anything from the owner or operator of the fire truck in light of the defendants’ immunity. The Court also rejected several arguments by which Loncar sought to recover under the excess policy even if the primary policy did not cover his damages. (Loncar died of unrelated causes during the appeal; the Court proceeded as if all parties were alive, under Rule 7.1(a)(1) of the appellate procedure rules.)Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-79372181382806031692018-05-21T14:54:00.000-05:002018-05-21T14:54:35.536-05:00BRIDAL SHOP’S CLAIM BASED ON THE “STIGMA” OF EBOLA IS A HEALTH CARE LIABILITY CLAIM <i>Texas Health Resources v. Coming Attractions Bridal and Formal</i><br />Dallas Court of Appeals, No. 05-17-00773-CV (May 16, 2018)<br />Wright, Fillmore, and Stoddart (opinion available <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=6b8c0f51-d628-4848-b629-2223a58d91c5&amp;MediaID=78452242-f30d-4fe0-b449-2aa393ace169&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-9885WEZp6Rw/WwMigXp0zgI/AAAAAAAAA_M/IHCpqtpbBnsFjcBS9jpwCXNM7CuEhWz2ACLcBGAs/s1600/bride.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="445" data-original-width="658" height="135" src="https://1.bp.blogspot.com/-9885WEZp6Rw/WwMigXp0zgI/AAAAAAAAA_M/IHCpqtpbBnsFjcBS9jpwCXNM7CuEhWz2ACLcBGAs/s200/bride.png" width="200" /></a></div>Coming Attractions Bridal and Formal sued Texas Health Resources (THR), claiming THR was responsible for the failure of its business. It alleged THR “negligently failed to heed the warnings” from the CDC and others regarding the imminent threat of an Ebola outbreak in the United States and did not provide its nurses with the necessary training, instruction, and protective equipment to prevent the spread of the disease. A nurse at a THR hospital treated an Ebola patient and contracted the disease. Before she was diagnosed, however, she traveled to Ohio and tried on wedding dresses at Coming Attractions. Once she was diagnosed with Ebola, the Ohio health authorities insisted the store close for cleaning. When the store reopened, it was unable to “dispel the perceived Ebola risk and stigma,” and the store closed permanently.<br /><br />The Hospital moved to dismiss the claim on the grounds that it was a health care liability claim under Chapter 74 of the Texas Civil Practice &amp; Remedies Code and that Coming Attractions failed to file an expert report as required by that statute. The trial court denied the motion, and the Hospital filed an interlocutory appeal. The Dallas Court of Appeals sided with THR, holding the claim was a health care liability claim and an expert report was required because the bridal shop’s allegations were “directly related to the provision of health care” and “directly implicate THR’s duties as a health care provider.” The safety duties THR allegedly violated are not “the types of duties that arise in an ordinary negligence case.” The appellate court also rejected Coming Attractions’ argument that it is not subject to Chapter 74 because it is not a “claimant” as defined in the statute. The Court noted that a claimant is any “person” who seeks to recover damages in a health care liability claim, and the term is not limited to patients or other natural persons.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-70800166277974767502018-05-11T13:16:00.000-05:002018-05-11T13:16:11.865-05:00LACHES BARS MANDAMUS IN ELECTION CASE<i>In re Martin</i><br />Dallas Court of Appeals, No. 05-18-00542-CV (May 10, 2018)<br />Francis, Evans (Opinion, available <a href="http://www.search.txcourts.gov/SearchMedia.aspx?MediaVersionID=223b60b7-dade-43d1-b260-1da16450977a&amp;MediaID=0062475c-1163-4836-a363-acb66a7bb948&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Order" rel="nofollow" target="_blank">here</a>), and Schenck<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://3.bp.blogspot.com/-BZGQ383_mZA/WvXcTUHq9FI/AAAAAAAAA-0/hQYU7aW3adklsPE9rC0lU0SzeAiRYrK5gCLcBGAs/s1600/vote.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="396" data-original-width="459" height="172" src="https://3.bp.blogspot.com/-BZGQ383_mZA/WvXcTUHq9FI/AAAAAAAAA-0/hQYU7aW3adklsPE9rC0lU0SzeAiRYrK5gCLcBGAs/s200/vote.png" width="200" /></a></div>Christopher Martin and Tina Marie High Brumbelow are candidates in a run-off election for the office of district judge in Van Zandt County. A week before early voting was to begin, Martin sought a writ of mandamus ordering the Van Zandt County Republican Party Chair to declare Brumbelow ineligible to be a candidate in the run-off. Martin contended Brumbelow was not registered to vote in the district for six months prior to the election filing deadline as required by the Election Code. The Dallas Court of Appeals denied the petition, finding it was barred by laches. Mandamus is largely controlled by equitable principles, one of which is that “equity aids the diligent and not those who slumber on their rights.” The Court noted that Martin challenged Brumbelow’s eligibility almost two months after the primary election and less than a week before early voting in the run-off began and that Martin failed to explain why he did not challenge Brumbelow’s eligibility sooner. The timing of Martin’s petition effectively deprived Brumbelow of any opportunity to meaningfully respond, to marshal responsive facts and law, and to obtain counsel to defend the allegations before the early voting deadline. So, the Court concluded that Martin’s complaint was barred by laches. The Court also found that Martin failed to conclusively establish Brumbelow’s ineligibility and so did not establish that the Republican Party violated a “duty imposed by law” in refusing to declare her ineligible. Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-45850265818037889542018-05-10T09:30:00.001-05:002018-05-10T09:30:21.177-05:00SPECIFIC-CAUSATION HURDLE TRIPS ANOTHER PLAINTIFF’S BENZENE JUDGMENT<i>E.I. DuPont de Nemours &amp; Co. v. Hood</i><br />Dallas Court of Appeals, No. 05-16-00609-CV (May 8, 2018)<br />Justices Bridges (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=331b0eaf-a593-421e-9ecf-c972ade613ae&amp;MediaID=c1ab40f1-e4a5-42a5-ba97-ea1aede7554a&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), Myers, and Schenck<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-v0cnvVGcKng/WvRVFIaMS4I/AAAAAAAAA-c/lhYPGq6AZp854__iAPKlygoFIzaBIhyCwCLcBGAs/s1600/800px-110m_Helsinki_2005.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="533" data-original-width="800" height="133" src="https://1.bp.blogspot.com/-v0cnvVGcKng/WvRVFIaMS4I/AAAAAAAAA-c/lhYPGq6AZp854__iAPKlygoFIzaBIhyCwCLcBGAs/s200/800px-110m_Helsinki_2005.jpg" width="200" /></a></div>Holding the testimony of plaintiff’s experts was no evidence that benzene was the specific cause of a painter’s disease, the Dallas Court of Appeals reversed a $7 million judgment and rendered judgment for the defendant.<br /><br />Virgil Hood worked for many years as an industrial painter, first for a tractor-trailer manufacturer and later for an airline. He was diagnosed with acute myelogenous leukemia (AML) in 2012, and filed a product liability lawsuit against several companies, including DuPont, alleging his exposure to benzene contained in products distributed by the defendants caused him to develop AML. After a jury trial, Hood was awarded just under $7 million.<br /><br />The dispositive issue on appeal was whether the testimony of Hood’s experts was legally sufficient evidence to support the judgment. The Court followed the Texas Supreme Court’s direction in <i>Havner</i> to “undertake an almost <i>de novo</i>-like review and ... look beyond the expert’s bare testimony to determine the <i>reliability</i> of the theory underlying it.” <i>Merrell Dow Pharms., Inc. v. Havner</i>, 953 S.W.2d 706, 710 (Tex. 1997). As in <i>Havner</i> and many other cases, the plaintiff’s primary obstacle was to move beyond general causation—“benzene exposure is associated with AML”—and prove exposure to benzene (or other toxic substance) was the specific cause of his particular injury or disease.<br /><br />Hood offered the testimony of industrial hygienist James Stewart, who “calculated Hood’s dose of lifetime benzene exposure,” and Dr. Sheila Butler, who used Stewart’s calculation and compared several epidemiological studies “to supply the alleged causal link between Hood’s lifetime cumulative benzene dose and his development of AML.” In excruciating detail, the Court analyzed the data, assumptions, methodology, and studies underlying the experts’ opinions, and found fatal flaws rendering them unreliable. Concluding the expert opinions were “no evidence of causation,” the Court reversed and rendered a take-nothing judgment.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-32587005774522336822018-05-04T17:17:00.000-05:002018-05-04T17:17:44.471-05:00DEFENSE COUNSEL AS “SUB-AGENT” OF INSURED CLIENT?<i>McCain v. Promise House, Inc.</i><br />Dallas Court of Appeals, No. 05-16-00714-CV (May 2, 2018)<br />Justices Bridges (Opinion linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=bd8394f7-7188-49f6-933d-16a1dece19e9&amp;MediaID=21914295-2553-4ffe-b506-fca253a99a95&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>), Fillmore, and Stoddart<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/lyndon-bittle/" rel="nofollow" target="_blank">Lyndon Bittle</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-UHuGNPPVQ5s/Wuzaqv0ilUI/AAAAAAAAA-E/ACC3De3O0twWCgLEccm9tyKKBL_fMPhfgCLcBGAs/s1600/settlement.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="376" data-original-width="409" height="183" src="https://1.bp.blogspot.com/-UHuGNPPVQ5s/Wuzaqv0ilUI/AAAAAAAAA-E/ACC3De3O0twWCgLEccm9tyKKBL_fMPhfgCLcBGAs/s200/settlement.jpg" width="200" /></a></div>Citing a policy provision giving a liability insurer the right to settle a claim against its policyholder without the policyholder’s consent, the Dallas Court of Appeals enforced a Rule 11 settlement agreement signed by the policyholder’s attorney (retained by the insurer) despite the policyholder’s objection. The opinion provides a roadmap for enforcing Rule 11 agreements, while raising troubling issues about the relationships between an insured client, its insurer-retained attorney, and the insurer. Is an appointed counsel the “sub-agent” of the insured client?<br /><br />McCain sued Promise House, alleging that his son had been physically and sexually abused while a resident there. Promise House had liability insurance with Arch, and the policy included a “sexual or physical abuse” endorsement. That endorsement provided Arch would have the “right and duty to defend” Promise House against any suit making such allegations. So, when McCain filed suit, Promise House filed a claim with Arch, and Arch retained counsel who began defending the lawsuit for Promise House. In the same paragraph imposing the duty to defend, the policy authorized Arch to, “at [its] discretion, investigate any act of ‘sexual or physical abuse’ and settle any claim or ‘suit’ that may result.” Within a month after answering the lawsuit, the attorneys for Promise House—provided by Arch—entered into a Rule 11 settlement agreement with McCain, securing a full and final release in exchange for a payment of $400,000. About two months later, however, Promise House objected to the “proposed settlement” and took the position its attorney—the attorney provided by Arch—did not have the authority to enter into the settlement agreement on its behalf. That’s where things got interesting.<br /><br />Upon learning of Promise House’s position, McCain filed the Rule 11 agreement with the court, and amended his petition to assert breach-of-contract claims against both Promise House and Arch. McCain argued, among other things, that the signature of Promise House’s attorney alone made the agreement enforceable, and that Arch had both a right and a duty to accept the settlement. Promise House argued its attorney was not authorized to execute the Rule 11 agreement, and did so without Promise House’s knowledge, consent, authorization, or approval. Arch agreed the policy gave it the right to settle, but denied it was a party to any contract with McCain. The parties filed cross motions for summary judgment, and the trial court entered a take-nothing judgment against McCain.<br /><br />On appeal, McCain argued Promise House’s policy gave Arch the absolute right to settle all claims, and “Arch, through its assigned defense counsel, authorized and approved the settlement”that bound Arch to pay the $400,000. The Court of Appeals agreed, and reversed and rendered judgment against both Promise House and Arch.<br /><br />The Court’s analysis has two key components: enforcement of Rule 11 agreements and the relationships between the insurer, the insured, and defense counsel. The Court confirmed that “a written settlement agreement may be enforced even though one party withdraws consent before judgment is rendered on the agreement.” To enforce the agreement, the offended party must, as McCain did here, pursue a separate breach-of-contract claim and establish the elements of such a claim. Although the agreement in this case contemplated the settlement would be “memorialized in a final settlement agreement,” the Court held it contained all the essential terms and was enforceable. The Court did not discuss whether—apart from the insurance issues—Promise House had rebutted the presumption that “an attorney retained for litigation [has] authority to enter into a settlement on behalf of a client.” <i>City of Roanoke v. Town of Westlake</i>, 111 S.W.3d 617, 629 (Tex. App.—Fort Worth 2003, pet. denied); <i>see also Karle v. Innovative Direct Media, Ltd.</i>, 309 S.W.3d 762, 765 (Tex. App.—Dallas 2010, no pet.). It does not appear from the opinion that McCain had any reason to question the authority of Promise House ‘s attorney of record at the time the settlement was negotiated.<br /><br />The Court found the attorney’s authority to settle in the client’s insurance policy under which the lawyer was appointed: “Arch retained counsel to represent Promise House; thus Arch became Promise House’s agent, and the attorney became Promise House’s sub-agent.” To support this holding, the Court relied on language in <i>Ranger County Mut. Ins. Co. v. Guin</i>, 723 S.W.2d 656, 659 (Tex. 1987). The Court did not mention the Supreme Court’s later repeated characterizations of the cited language in <i>Ranger </i>as dicta. <i>See State Farm Mut. Auto. Ins. Co. v. Traver</i>, 980 S.W.2d 625, 628 (Tex. 1998) (citing <i>American Physicians Ins. Exch. v. Garcia</i>, 876 S.W.2d 842, 849 (Tex. 1994)). In <i>Traver</i>, the Supreme Court reiterated the long-standing principle that a lawyer’s sole duty is “unqualified loyalty” to the client, even when the lawyer has been appointed and is being paid by an insurer. 980 S.W.2d at 627-28 (citing <i>Employers Cas. Co. v. Tilley</i>, 496 S.W.2d 552, 558 (Tex. 1973)). Although the Court in McCain does not articulate how Arch became a party to the settlement contract if the only signature was by counsel for Promise House, it appears to presume the same counsel represented both the insurer and the insured. While some other jurisdictions hold an appointed defense counsel effectively has two clients (the insurer and the insured), Texas is decidedly a “one-client” state.<br /><br />Nevertheless, as the Court recognized, the policy granted Arch the right to settle claims in its discretion. (Disputes between Promise House and Arch remain pending in a separate lawsuit.) But as demonstrated here, exercising this right can be complicated without participation by the insured. An insured’s interference with its insurer’s right to settle could in some circumstances breach the insured’s duty to cooperate, and thus potentially undermine coverage under the policy. And because the <i>Stowers</i> duty is owed only to the insured, the insured’s objection to the settlement would negate the insurer’s duty to accept a reasonable settlement offer, though not its right to do so.<br /><br />On the other hand, no one suggests McCain did not enter into the settlement in good faith, relying on the apparent authority of the defendant’s counsel of record. And Arch, from which the attorney received instructions, unquestionably intended to fund the settlement. So, a disinterested observer might conclude the Court reached the right, “common sense” result, but left a number of thorny issues unresolved.<br /><br />Many, if not all, of these issues were briefed by the parties, but are not addressed in the opinion. Stay tuned for further developments.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-84904488728448737582018-05-01T11:42:00.001-05:002018-05-01T11:42:52.168-05:00YES, THE TCPA PROTECTS LAWYERS’ SPEECH, TOO<i>Youngkin v. Hines</i><br />Supreme Court of Texas, No. 16-0935 (April 17, 2018)<br />Justice Lehrmann (Opinion, linked <a href="http://www.txcourts.gov/media/1441472/160935.pdf" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/brent-m-rubin/" rel="nofollow" target="_blank">Brent Rubin</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://4.bp.blogspot.com/-PD5BI6ANW98/WuiXO9wzRdI/AAAAAAAAA9s/rK_wTazRjI0EMc-tEPpZahE6fmqTBxitgCLcBGAs/s1600/Talk%2BLike%2Ba%2BLawyer.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="360" data-original-width="480" height="150" src="https://4.bp.blogspot.com/-PD5BI6ANW98/WuiXO9wzRdI/AAAAAAAAA9s/rK_wTazRjI0EMc-tEPpZahE6fmqTBxitgCLcBGAs/s200/Talk%2BLike%2Ba%2BLawyer.jpg" width="200" /></a></div>During trial in a property dispute, Youngkin, an attorney, negotiated a settlement between his clients, the Scotts, and Hines. Youngkin recited the terms of the settlement into the court record as prescribed by Texas Rule of Civil Procedure 11. Hines later argued the settlement entitled him to full ownership of a tract of land but that the Scotts deeded him only partial ownership. Hines sued the Scotts for fraud and breach of the settlement agreement. Hines also sued Youngkin for participating in the Scotts’ allegedly fraudulent scheme by, among other things, entering into the Rule 11 agreement on the Scotts’ behalf while purportedly knowing the Scotts had no intent to comply.<br /><br />Youngkin moved to dismiss under the Texas Citizens Participation Act, Texas’s anti-SLAPP statute. The trial court and the court of appeals denied Youngkin’s request, but the Supreme Court of Texas disagreed, finding the claims against Youngkin should be dismissed. The Legislature enacted the TCPA for the purpose of “safeguard[ing] the constitutional rights of persons to petition, speak freely, [and] associate freely.” The TCPA applies when a claim is based on or related to the exercise of one of those rights. Once a court determines that the TCPA applies, a plaintiff must put forward prima facie evidence of each element of its claim to avoid dismissal. Alternatively, a defendant can obtain dismissal by establishing a defense by a preponderance of the evidence.<br /><br />The TCPA defines the exercise of the right to petition to include “a communication in or pertaining to ... a judicial proceeding.” Hines argued that Youngkin was merely speaking for his clients and was thus not exercising any personal First Amendment right entitled to protection under the TCPA, pointing to the purposes provision of the statute. The Court disagreed. It explained that the TCPA’s application is not restricted to activities protected by the First Amendment because the portion of the statute defining the “exercise of the right to petition” contains no such limitation. The Court ruled that under the plain language of the TCPA, Youngkin’s recitation of the Rule 11 agreement in open court was an exercise of the right to petition triggering application of the TCPA.<br /><br />The Court then concluded Youngkin was entitled to dismissal because he established the affirmative defense of attorney immunity under the Court’s 2015 decision in <i>Cantey Hanger, LLP v. Byrd</i>. In <i>Cantey Hanger</i>, the Court held that an attorney’s liability to non-clients is limited to conduct outside the scope of his or her representation of his or her client or for conduct foreign to the duties of a lawyer. At bottom, the dispute between Hines and the Scotts turned on a disagreement over the substance of the settlement agreement. Youngkin’s negotiation of and subsequent advocacy for a favorable interpretation of that agreement in the service of his clients—“even if done improperly”—fell within the scope of his representation and thus afforded him attorney immunity and dismissal under the TCPA.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-39475014711303645422018-04-30T17:37:00.000-05:002018-05-04T12:28:51.076-05:00TEXAS SUPREME COURT ORDERS DISCOVERY TO DETERMINE REASONABLENESS OF HOSPITAL’S RATES<div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-ZHqfeFB_N2I/WIu9XcMew4I/AAAAAAAAApY/Gaw7BLdzL_McsiF3Jt6CJTITnPVvBU71ACPcBGAYYCw/s1600/TexasBarToday_TopTen_Badge_June2016%2B72pixels.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="102" data-original-width="72" src="https://1.bp.blogspot.com/-ZHqfeFB_N2I/WIu9XcMew4I/AAAAAAAAApY/Gaw7BLdzL_McsiF3Jt6CJTITnPVvBU71ACPcBGAYYCw/s1600/TexasBarToday_TopTen_Badge_June2016%2B72pixels.jpg" /></a></div><i>In re North Cypress Medical Center Operating Co., Ltd.</i><br />Supreme Court of Texas, No. 16-0851 (April 27, 2017)<br />Justice Lehrmann (opinion available <a href="http://www.txcourts.gov/media/1441470/160851.pdf" rel="nofollow" target="_blank">here</a>); Chief Justice Hecht dissenting (dissent available <a href="http://www.txcourts.gov/media/1441471/160851d.pdf" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/debran-oneil/" rel="nofollow" target="_blank">Debrán O’Neil</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://2.bp.blogspot.com/-sj4aBcIdbec/WueaKPz1aQI/AAAAAAAAA9U/pqulkb38yXMTu0937g1JInVRl41DZbYfgCLcBGAs/s1600/steth.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="168" data-original-width="299" height="179" src="https://2.bp.blogspot.com/-sj4aBcIdbec/WueaKPz1aQI/AAAAAAAAA9U/pqulkb38yXMTu0937g1JInVRl41DZbYfgCLcBGAs/s320/steth.jpg" width="320" /></a></div>Plaintiff sued North Cypress Medical Center Operating Co. (the “Hospital”), challenging the enforceability of the Hospital’s lien for medical services rendered to Plaintiff, who was uninsured. Noting the standard for discovery is lower than the standard for admissibility, the Court held the reimbursement rates a hospital receives from private insurance and federal healthcare programs are relevant to the reasonableness of charges to uninsured patients. The Court therefore required the Hospital to produce that information in discovery.<br /><br />After providing emergency hospital services to Plaintiff following a car accident, the Hospital billed Plaintiff at its full “rack-rate” and asserted a hospital lien on that amount pursuant to Texas Property Code § 55.002(a), which allows hospitals a lien on money a plaintiff receives for medical expenses caused by the negligence of another person. After the Hospital and Plaintiff failed to reach an agreement on a reduced bill, Plaintiff sought a declaratory judgment that the Hospital’s charges were unreasonable and the lien was invalid to the extent it exceeded the reasonable and regular rate for the services the Hospital rendered. The trial court required the Hospital to produce documents and information concerning its reimbursement rates from private insurers and public payers such as Medicare and Medicaid for the same medical services provided to Plaintiff at the time in question. The Hospital sought mandamus relief, arguing the discovery sought was not relevant to the reasonableness of charges to uninsured patients because uninsured patients are not entitled to the benefits of negotiated rates. Several hospital systems filed amicus briefs in support of the Hospital’s position.<br /><br />In its opinion ordering production of the contested documents and information, the majority noted that hospitals increasingly charge or quote a “full-price” rate but rarely actually collect that amount. The Court concluded the rates a hospital accepts as payment from the majority of its patients, even if they are differently situated than uninsured patients, are relevant to—but not dispositive of—the reasonableness of its charges for uninsured patients like the Plaintiff here. Because discovery sought must only be relevant to the cause of action, meaning it has “any tendency to make a fact ... more or less probable than it would be without the evidence,” the insured or negotiated rates were discoverable. The Court rejected the Hospital’s argument that the rates were confidential and proprietary, noting the insurance contracts could be produced pursuant to a confidentiality agreement.<br /><br />The dissent observed that each patient, whether insured or not, is charged the full rate. Only if there is a negotiated rate with an insurance company or the government does a hospital agree to accept a lower rate, usually due to the benefits to the hospital of having increased patient volumes and ease of collections. The dissent noted that Plaintiff failed to show the rates charged by the Hospital were different than the rates charged to any other similarly-situated patient. Consequently, the dissent argued, insurance or other negotiated reimbursement rates are wholly irrelevant to charges for uninsured patients.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-84704051091472611102018-04-27T17:31:00.001-05:002018-04-27T17:31:20.717-05:00TEXAS SUPREME COURT ADOPTS “SHAM AFFIDAVIT RULE”<i>Lujan v. Navistar, Inc.</i><br />Supreme Court of Texas, No. 16-0588 (April 27, 2018)<br />Justice Blacklock (opinion available <a href="http://www.txcourts.gov/media/1441466/160588.pdf" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-mrEY-uRIsRQ/WuOkHLhEm9I/AAAAAAAAA84/Nxr5oJPelHwRCfqPf18vXBaOkNQJxg_zgCLcBGAs/s1600/flowers.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="382" data-original-width="571" height="133" src="https://1.bp.blogspot.com/-mrEY-uRIsRQ/WuOkHLhEm9I/AAAAAAAAA84/Nxr5oJPelHwRCfqPf18vXBaOkNQJxg_zgCLcBGAs/s200/flowers.jpg" width="200" /></a></div>Most Texas appellate courts have adopted the “sham affidavit rule”—if a party submits an affidavit that conflicts with the affiant’s prior sworn testimony and does not provide a sufficient explanation for the conflict, a trial court may disregard the affidavit when deciding whether the party has raised a genuine fact issue to avoid summary judgment.<br /><br />In this case, Lujan acquired a wholesale flower company and purchased five new delivery trucks from Navistar. Lujan sued Navistar, alleging repeated mechanical problems with the trucks, and a dispute arose about whether Lujan or his company, Texas Wholesale Flower Co., Inc., actually owned the trucks. Based on prior testimony, statements on the record by Lujan’s counsel, and documents such as corporate tax returns, Navistar filed a motion for summary judgment against Lujan on the grounds that Lujan did not own the trucks and did not have standing to bring suit. Lujan responded with an affidavit stating that “he did not transfer ownership of the trucks to the Corporation and that the Corporation had no assets or liabilities and ‘never conducted business.’” The trial court found that the statements regarding the Corporation’s assets and liabilities and that it never conducted business were demonstrably false and that the statement that Lujan never transferred ownership of the trucks to the Corporation contradicted other testimony and evidence in the case, a contradiction for which Lujan gave no explanation. So the trial court struck the affidavit as a “sham” and granted summary judgment. Lujan appealed. A divided panel of the 14th Court of Appeals affirmed and “adopt[ed] the sham affidavit doctrine,” which had never been explicitly recognized by that court.<br /><br />The Texas Supreme Court granted review, adopted the sham affidavit rule, and affirmed the summary judgment. It acknowledged that sometimes a contradictory affidavit is warranted, but an explanation for the contradiction is required—for example, that new evidence was discovered or the witness was confused when originally answering the question. While a trial court must not weigh evidence at the summary judgment stage, the rules of procedure require the court to determine whether a proffered fact issue is “genuine,” which means “authentic or real.” A “sham” is, by definition, “not genuine.” And so the sham affidavit rule merely recognizes the authority of a trial court to require litigants to explain conflicting testimony that appears to be a sham designed to avoid summary judgment. The Court cautioned that “most differences between a witness’s affidavit and deposition are more a matter of degree and details than direct contradiction. This reflects human inaccuracy more than fraud.” The sham affidavit rule only provides that where the circumstances point to the likelihood of a sham rather than legitimate questions of fact, the trial court may insist on a sufficient explanation and may grant summary judgment if none is forthcoming. Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-74913398496926491422018-04-20T14:22:00.000-05:002018-04-20T14:22:14.734-05:00CORPORATION CAN BE A TEXAS RESIDENT, EVEN IF IT WASN’T “BORN” HERE<i>Winnsboro Auto Ventures LLC v. Santander Consumer USA, Inc.</i><br />Dallas Court of Appeals, No. 05-17-00895-CV (April 19, 2018)<br />Bridges, Myers, and Schenck (opinion available <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=f460e0eb-25d0-4f9d-9181-57da77f4fa98&amp;MediaID=1bf823cc-b2e2-4e8b-a7e1-a3391227d743&amp;coa=%22%20+%20this.CurrentWebState.CurrentCourt%20+%20@%22&amp;DT=Opinion" rel="nofollow" target="_blank">here</a>)<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/kelli-m-hinson/" rel="nofollow" target="_blank">Kelli Hinson</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://3.bp.blogspot.com/-Gh0vNQM_IGo/Wto9qw3Wc0I/AAAAAAAAA8g/jSHHSfxCOfcTjsPOrsoRaN9S3rtXFbDyACLcBGAs/s1600/license%2Bplate.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="380" data-original-width="610" height="124" src="https://3.bp.blogspot.com/-Gh0vNQM_IGo/Wto9qw3Wc0I/AAAAAAAAA8g/jSHHSfxCOfcTjsPOrsoRaN9S3rtXFbDyACLcBGAs/s200/license%2Bplate.png" width="200" /></a></div>The Texas long-arm statute allows Texas courts to exercise personal jurisdiction over non-resident defendants “doing business” in Texas. Among other things, the statute provides that contracting with a “Texas resident,” where either party is to perform the contract in whole or in part in Texas, constitutes “doing business” in this state. This case involved a breach-of-contract claim brought against a Louisiana company, Winnsboro, by Santander, a company incorporated in Illinois but with its principal place of business and corporate headquarters in Texas. Winnsboro contested personal jurisdiction, arguing that Santander was not a Texas resident able to take advantage of the long-arm statute because it was incorporated in Illinois.<br /><br />The term “Texas resident” is not defined; so Winnsboro looked to other statutes that define “non-residents” or “foreign corporations” as corporations formed under the laws of another state. It argued that, if corporations formed in another state are “non-residents” or “foreign corporations,” they cannot also be “residents.” The Court of Appeals disagreed, holding that the cited definitions are not applicable to the long-arm statute and, in any event, do not purport to define “resident.” The Court could find no language in the statute, and no logical rationale, to support the conclusion that the legislature meant to exclude corporations incorporated in another state but maintaining their principal place of business here from invoking the Texas courts’ long-arm power. To hold otherwise would have the practical effect of preventing businesses located in this state from having access to Texas courts, which would give rise to constitutional concerns.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.comtag:blogger.com,1999:blog-3586544864086164972.post-51493245476461224302018-04-19T19:21:00.001-05:002018-04-19T19:21:47.358-05:00JURY’S DAMAGES VERDICT OKAY IF IT’S SOMEWHERE IN BETWEEN, EVEN IF IT’S UNCLEAR HOW THEY GOT THERE <i>Baker v. Habeeb</i><br />Dallas Court of Appeals, No. 05-16-01209-CV (April 18, 2018)<br />Justices Lang, Brown (Opinion, linked <a href="http://search.txcourts.gov/SearchMedia.aspx?MediaVersionID=b85b18f4-be31-428d-aa9c-69b5483204f0&amp;coa=coa05&amp;DT=Opinion&amp;MediaID=14a6822a-bd60-47bf-9c0c-ab015f2611b6" rel="nofollow">here</a>), and Whitehill<br /><div style="text-align: right;"><a href="https://www.ccsb.com/attorneys/ken-carroll/" rel="nofollow" target="_blank">Ken Carroll</a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://4.bp.blogspot.com/-01iy3wmGtRs/WtkyEPA8GBI/AAAAAAAAA8I/4XvYIzCaZJM4vatn3yszmaMPjjs8kmWKgCLcBGAs/s1600/rock.jpg" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="336" data-original-width="258" height="200" src="https://4.bp.blogspot.com/-01iy3wmGtRs/WtkyEPA8GBI/AAAAAAAAA8I/4XvYIzCaZJM4vatn3yszmaMPjjs8kmWKgCLcBGAs/s200/rock.jpg" width="153" /></a></div>Habeeb develops and produces TV programs. He rented space from Baker’s partnership, 3900 Commerce. During the last few weeks of Habeeb’s occupancy, Baker had maintenance workers from 3900 Commerce begin clearing the space out, to prepare for a new tenant. Oops. During the clearing-out process, the workers mistakenly disposed of the master tapes of more than 50 episodes of two programs that Habeeb had stored in the rented space. At trial, Habeeb’s expert testified that the total discounted value of the lost episodes was $4,847,000. Baker’s expert disagreed, placing the value at $160,000. The jury returned a verdict for Habeeb and assessed damages in between, at $2,582,854.60. Baker appealed, but the Dallas Court of Appeals affirmed.<br /><br />Most of the Court’s opinion was devoted to a careful application of the Texas Supreme Court’s <i>Robinson</i> standards to Habeeb’s expert witness and his valuation testimony in the unique setting of this case. But Baker also argued that the jury’s $2,582,854.60 damages award was not supported by legally sufficient evidence, and that the value of the lost tapes was not established with the requisite “reasonable certainty.” Although the jury’s damages number was something of a head-scratcher, the Court of Appeals held the “jury’s finding may not be set aside because its reasoning in arriving at the amount of damages is unclear.” The Court explained that a “jury is free to accept or reject all or any portion of an expert’s testimony” and “has discretion to award damages within the range of evidence presented at trial, so long as there is a rational basis for calculation.” So, “[w]hile it is not clear how the jury arrived at this figure, it had the discretion to award damages within the range presented at trial”—i.e., somewhere between the $4.8 million to which Habeeb’s expert testified, and the $160,000 urged by Baker’s expert.Carrington Colemanhttps://plus.google.com/101773802555429988396noreply@blogger.com